NRA Prevails Over NYAG’s Bid for Dissolution, Compliance Monitor

←back to cases

Brewer, Attorneys & Counselors achieved a major legal victory on behalf of the National Rifle Association of America (“NRA”) in July 2024 when a New York Supreme Court Justice rejected the New York Attorney General’s (“NYAG”) demands that a compliance monitor be appointed to oversee the historic gun rights organization. The New York Times reported it was a “win” for the gun rights group and the “beginning of the end of a four-year-old case…”

In August 2020, NYAG Letitia James filed a “dissolution lawsuit” against the NRA – a case that sought to shut down the Association and seize its assets. Four years later, following trial proceedings, Justice Joel M. Cohen rejected the NYAG’s demands for a compliance monitor and instead recommended the NRA and NYAG confer to consent to further governance reforms. In accordance with the court’s direction, the NRA will suggest additional reforms in furtherance of its ongoing commitment to good governance.

The NYAG sought something vastly different:  a “monitor” that would have been an invasive and crippling remedy with financial oversight, access to employees and records, and an open line of communication with the NYAG. 

“Key facts and a chorus of voices established that the relief sought by the NYAG was unwarranted,” said NRA counsel William A. Brewer III. “The NRA organized its defense around an important reality: there was no evidence the NRA Board of Directors condoned the violations in question; instead, the board acted when it became aware of deviations from its own controls. That said, the Association takes seriously its commitment to stay in strict compliance with all controls.”

The NRA will pay no fines, collect awards from individual defendants, and have the freedom to pursue its mission. An expected final award of millions of dollars against former Executive Vice President and CEO Wayne LaPierre will be payable to the NRA, as will proceeds from prior settlements with former NRA executives Josh Powell and Wilson Phillips.

The court found no reason to remove NRA Secretary John Frazer from his position.

 “We recognize the importance of the jury’s findings and will continue our commitment to good governance,” said NRA President Bob Barr, as he “praised the Association’s millions of loyal members who never lost faith in the organization and its commitment to protecting freedom.”

A 10-day bench trial that concluded on July 29, 2024, followed a 24-day jury trial earlier in the year, during which the NRA established that the NYAG failed to prove self-dealing or bad faith by the NRA Board. The NRA challenged the NYAG’s narrative that any governance issues at the NRA are “persistent” or ongoing.

Importantly, reflected in the court’s decision was recognition that the NRA established that it adopted new policies and accounting controls, displaced vendors and “insiders” who abused the Association, and accepted reparations for costs determined to be excess benefits. Most of these corrective measures – part of an internal investigation ignited by the NRA Board in 2018 – were underway before the NYAG even began her investigation.

Upon assuming office in 2019, Attorney General James launched an investigation and sought to put the NRA out of business. As part of her drive to destroy the NRA, on July 1, 2024, James requested a court-appointed delegate with sweeping powers over the Association.  

The NRA’s defense focused on its compliance efforts and the organization’s commitment to good governance following whistleblower complaints that emerged in the summer of 2018. When the NRA Board was alerted to the allegations, it led an investigation and determined that certain individuals participated in transactions that ran afoul of NRA policies and procedures. Testimony confirmed the “tone at the top” of the NRA has indeed changed.

Joining Brewer in representing the NRA were firm partners Sarah B. Rogers, Svetlana M. Eisenberg, and Noah Peters.

Related News

• “New York’s Gift to the NRA,” The New York Sun

• “Judge Lets N.R.A. Keep Its Independence but Pushes for Reforms,” The New York Times

• “Judge Tosses New York AG’s Bid to Dissolve NRA,” The Wall Street Journal

• “NRA Scores Court Victory Against AG Letitia James in New York,” Daily Caller

•  “Judge Blocks NY’s Bid to Shutter NRA, but Lawsuits Continues,” Associated Press

• “Brewer News Release – NRA Prevails Over NYAG: Court Rules Association Cannot Be Dissolve,” Brewer, Attorneys & Counselors

Supreme Court Unanimously Rules for NRA in First Amendment Case Against Former New York Regulator

←back to cases

On May 30, 2024, Brewer client, the National Rifle Association of America (NRA), scored a historic legal victory in one of the most closely followed First Amendment cases in the nation.

In a stinging rebuke of New York’s “blacklisting campaign” against the NRA, the Supreme Court unanimously ruled for the NRA in its case against former New York State Department of Financial Services Superintendent Maria T. Vullo. The decision remands the NRA’s case to the lower court – reviving the NRA’s claims that Vullo, at the behest of former New York Governor Andrew Cuomo, violated the NRA’s First Amendment rights when she urged banks and insurers to cut ties with the NRA in 2018.

““This is a landmark victory for the NRA and all who care about our First Amendment freedom. The opinion confirms what the NRA has known all along: New York government officials abused the power of their office to silence a political enemy. This is a victory for the NRA’s millions of members and the freedoms that define America.” ”

— William A. Brewer III, counsel to the NRA

The opinion of the court, written by Justice Sonia Sotomayor, states, “Six decades ago, this Court held that a government entity’s ‘threat of invoking legal sanctions and other means of coercion’ against a third party ‘to achieve the suppression’ of disfavored speech violates the First Amendment… Today, the Court reaffirms what it said then: Government officials cannot attempt to coerce private parties in order to punish or suppress views that the government disfavors. Petitioner National Rifle Association (NRA) plausibly alleges that respondent Maria Vullo did just that.”

“This victory is a win for the NRA in the fight to protect freedom,” says NRA President Bob Barr. “This is a historic moment for the NRA in its stand against governmental overreach. Let this be clear: the voice of the NRA membership is as loud and influential as ever. Regulators are now on notice: this is a win for not only the NRA, but every organization who might otherwise suffer from an abuse of government power.”

In the opinion, Justice Sotomayor writes that Vullo was “free to criticize the NRA” but “could not wield her power, however, to threaten enforcement actions against DFS-regulated entities in order to punish or suppress the NRA’s gun-promotion advocacy.”

Justice Sotomayor continues, “One can reasonably infer from the complaint that Vullo coerced DFS-regulated entities to cut their ties with the NRA in order to stifle the NRA’s gun-promotion advocacy and advance her views on gun control.”

The History of the Case

In a May 2018 lawsuit, the NRA alleged that Vullo, at the urging of Governor Cuomo, took aim at the NRA and conspired to use DFS’ regulatory power to “financially blacklist” the NRA – coercing banks and insurers to cut ties with the Association to suppress its pro-Second Amendment speech. The NRA argues that Vullo’s actions were meant to silence the NRA – using “guidance letters,” backroom threats, and other measures to cause financial institutions to “drop” the Association.

The NRA's First Amendment claims withstood multiple motions to dismiss. But in 2022, after Vullo appealed the trial court’s ruling, the Second Circuit struck down the NRA’s claims. The court ruled that in an era of “enhanced corporate social responsibility,” it was reasonable for New York's financial regulator to warn banks and insurance companies against servicing pro-gun groups based on the supposed “social backlash” against those groups’ advocacy. The court also ruled that Vullo’s guidance – written on her official letterhead and invoking her regulatory powers – was not a directive to the institutions she regulated, but rather a mere expression of her political preferences.

On February 7, 2023, the NRA petitioned the U.S. Supreme Court, seeking review of the Second Circuit decision. On November 3, 2023, the Court granted review of the case.

Twenty-two amicus briefs representing more than 190 individuals and organizations were filed in support of the NRA’s position, including a filing by several of the nation’s foremost First Amendment scholars. The amicus briefs also included a joint filing by dozens of congressional Republicans and filings by 25 state attorneys general. The support came from across the political spectrum.

On Monday, March 18, 2024, the Court heard oral arguments in the case. ACLU National Legal Director and NRA counsel David Cole argued that Vullo and other New York officials abused their authority in violation of the First Amendment, telling the justices: “There's no question on this record that they encouraged people to punish the NRA.” Cole said, “It was a campaign by the state’s highest political officials to use their power to coerce a boycott of a political advocacy organization because they disagreed with its advocacy.”

Eugene Volokh joined Brewer and the ACLU in representing the NRA, along with Brewer partners Sarah B. Rogers and Noah Peters.

Related News

• “A Unanimous Supreme Court Backs the NRA on Free Speech,” The Wall Street Journal

• “Supreme Court Unanimously Rules for NRA in Free Speech Fight,” The Hill

• “Unanimous Supreme Court Backs NRA in First Amendment Clash with New York Official,” MSN

• “Justices Seem Likely to Side with NRA in First Amendment Dispute,” The New York Times

• “Editorial: NRA Case Shows the Supreme Court Must Stop Informal Censorship,” Bloomberg Law

• “Justices Told NRA Speech Would Thwart Regulation,” Law360

• “The ACLU Has a New Client: The National Rifle Association,” The New York Times

• “Supreme Court to Hear N.R.A.’s Free Speech Case Against New York Official,” The New York Times

• “NRA Sues New York After Insurance Crackdown,” The Wall Street Journal 

• “NRA Sues New York Governor, Regulator for ‘Blacklisting Campaign,’” Reuters 

• “Commentary: The NRA vs. Authoritarianism,” The Wall Street Journal 

• “Cuomo Targets the NRA – and Free Speech,” Albany Times Union 

• “The NRA Has Declared War on Andrew Cuomo,” The New York Times 

• “To Limit the Second Amendment, New York Attacks the First,” The National Review 

• “Andrew Cuomo is Now at War with the Bill of Rights,” The New York Post 

• “Worse Than Taking Away Guns, New York Threatens to Take Away NRA’s Insurance,” Sinclair Media Group

• “ACLU Supports NRA’s Free-Speech Argument in Suit Against Cuomo Administration,” New York Law Journal

• “NRA Secures New Documents in Bid to Revive Selective Enforcement Claims Against NY Officials,” New York Law Journal

• “NRA Says New York Probe Goes Beyond So-Called ‘Murder Insurance’,” Bloomberg

• “NRA Seeks 2nd Circ. Rehearing In Free Speech Dispute,” Law360